Direct mail offers the advantage of a simple and immediate measure of success: the response rate. Another advantage of direct mail is that you can test the variables before committing all your resources to a particular approach. You can aim for realistic results while you keep your expenses within your budget.
Key points in to remember about direct mail:
- Define your target market as precisely as you possibly can. The more precisely you target, the better your response rates will be.
- Integrating direct mail with other marketing activities will improve your response.
- A series of mailings versus a single mailing will help ensure that you meet your response targets.
- Getting the mailing list right is vital. Check all internal sources of information to ensure that the information on your list is up to date. Mailing to existing customers and including information relevant to their interests will invariably generate the highest response rates.
- If you are moving into new market sectors, internal lists may not provide the information you need, and you may need to assemble or acquire lists from external sources to match your desired customer profile. Consider commissioning a tailored list from a list broker, to match your requirements exactly.
- Keep refining your lists and checking them for accuracy, to improve response and reduce waste.
- Personalized one-to-one mailings are an ideal form of communication for companies with detailed information about prospects. Personalize your mailings to the recipients as much as possible.
- Direct mail response levels can increase significantly when you conduct a telemarketing campaign in conjunction with the mailing.
What You Need to Know Before You Start
Why do direct mail responses tend to be so low?
The figures quoted below are industry averages. Your results can vary up or down, depending on your product, your market, the type of mailing, and other factors. Remember that a small percentage return from a mass mailing can provide you with a reasonable number of new prospects. To put the response rates into perspective, compare the response and the cost of response from direct mail with an equivalent amount of spending on advertising.
Should we always test direct mail?
If it is practical, test direct mail on a small sample of any target market. Although direct mail is a precise medium, testing can refine the process even further. With so many variables in a mailing campaign, you can test different elements individually and plan your full campaign on the basis of the best response rate.
How should we measure direct mail effectiveness?
The ultimate test of any marketing campaign is an increase in profitable sales. Direct mail can provide the mechanism for sales, but “making the sale” depends on pricing, the quality of your products, sales representatives, customer service, competitive activity, and many other factors. Direct mail should be given a specific role and measured by how it fulfills that role.
Planning Your Marketing Campaign
- Response levels as low as 1% or 2% are regarded as the industry norm.
- Response rates around 5% are regarded as high.
- Response rates between 10% and 20% have been reported by companies that have integrated direct mail with other forms of marketing communications.
Define Your Target Market
Do you want to reach all customers and prospects? Or are you targeting specific groups? Direct marketing is a precise medium, so your campaign could be aimed at one key decision maker or thousands of potential users. The more precisely you target, the better your response rates will be.
Use Direct Mail As Part of an Integrated Marketing Campaign
Although direct marketing campaigns can run at any time, results can be improved by integrating the campaign with other marketing activities, such as an exhibition, advertising campaigns, or sales force calls. With integrated campaigns, overall awareness levels among customers and prospects will be much higher, and your mailing offer will have a much higher chance of success.
Choose the Right Campaign Frequency
A mass mailing, telephone call, or direct response advertisement may produce results, but a series of quality contacts will have greater impact on prospects and will help ensure that you meet your response targets. Multiple direct marketing contacts provide a number of benefits:
- With each contact, you raise levels of awareness about your product or services.
- You can follow up with prospects who have not responded to previous contacts.
- You can encourage individual respondents further along the process of deciding to buy.
Web site or e-mail addresses, postage-paid envelopes, and toll-free numbers provide easy-to-use response mechanisms that can boost response. You should monitor the response levels from different mechanisms to see which are more effective
Test Your Approach
To help ensure success, you should test your approach before committing resources to the full campaign. There are a number of variables that can be tested:
- The offer
- The creative approach
- The target audience
- The response mechanism
- Frequency and timing of mailing
- Integration with other communications programs
Use Split Campaigns
If budget allows, you can develop a series of campaigns that vary by offer, creative approach, response mechanism, frequency, and timing. The results can give you a quick indication of what works best and how to design future campaigns.